Even before the Covid-19 pandemic began it was widely acknowledged that employees were looking for more than just a paycheck.
Now, nearly two years after the pandemic started, with stress, burnout, shifting sentiments towards remote working and The Great Resignation resulting in a fiercely competitive labor market, our HR leaders met to discuss how to redefine Total Rewards, and also to share best practices on how to navigate the uncertainty. Some of the key takeaways are summarized below:
- Asking employees what benefits they would like is a powerful way to improve their impact
Attendees reported several benefit additions they’ve used to round out their employee value proposition, including: child and elder care benefits, financial wellness, hearing benefits and additional leave. The positive sentiment towards the new benefits was found to be significantly increased when based on the results of employee surveys, which makes employees feel that the company is attentive to their needs.
- Physical and mental health support are both required for a well-rounded benefits package
Gym and fitness benefits were both reported as helping employees lead a more active lifestyle and de-stress despite the lockdowns; especially since so many introduced digital, at-home classes. Chair massages were referenced by several attendees as a worthwhile perk, as well as onsite mediation rooms.
Wellbeing management benefits were also well regarded as a low-cost, high-impact way to tackle stress and build resilience. Sharing information on hot topics such as meditation and mindfulness, or offering access to concierge services such as Bright Horizon, were particularly well received by employees.
Financial incentives are becoming the norm, and not just for top talent
Sign-on and recruitment bonuses have become a de facto expectation for many jobseekers. Retention/stay bonuses are also increasingly more common, with several attendees reporting significant payouts that are typically balanced by having extended payout schedules and enforceable clawbacks. Some organizations are reaching bonus levels as high as 15-20% of salary for mission-critical staff.
Organizations are getting creative with their bonus structures
Some attendees reported tying bonuses to ‘time retained’ and the other portion to discrete business metrics and KPIs, such as company stock growth. Responses also indicate a general trend towards increasing annual merit budgets, with some reaching as high as 4-5% as opposed to the traditionally standard 3%.
- Remote working has created financial complications for some businesses
Responses to compensation geo-differentials for remote workers were mixed: some moved to fully nationalized structures that use more general averages, while others have found locale-specific adjustments a necessary evil. A more concerning trend, however, has been a wave of employees that relocated without telling their employer, creating all sorts of legal and taxation issues.
Interestingly, some organizations reported being forced to hire in states they weren’t registered in to keep up with demands. This puts the tax reporting burden entirely on the employee, but it is an option.
- Vaccine incentives can be beneficial if approached in the right way
One of the most divisive financial levers discussed across Sessions has been vaccine incentives. While a handful of organizations are hesitant to “reward” compliance – especially given the complicated situations that could arise when exempt employees request parity – others are finding them to be a necessary cost for improving employee safety and getting their reporting more complete.
Several attendees reported tying these rewards directly in with wellness, in one case, by offering the maximum number of 2022 rewards points --$900 – for compliance, resulting in a near 20% increase in participation.
Connex Think Tanks are a series of highly interactive, practical discussions designed to stimulate innovative thinking and tackle the most pressing challenges faced by healthcare professionals.
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